Stock market is a big system of organized money-making company. The money is moved around every day for transaction in economical market. Stock market has a total of $71.6 Trillion traded each year, it is worth more than any market goods in the entire world market! But stock market is not selling goods or service, but they are selling the right of the company or most commonly called shares. Buying shares also means you are buying a part of that company.How does the shares exactly work?
Many factors could affect the shares performance, for example the company called “a” which sells hotdog to the market are getting good reputation form buyer, which will automatically rise the company share selling rate. But you must buy the shares when the stock price is low. And sell it when the market stock is high. So, if the company’s share price is high, you must wait and buy the share when the price is a bit lower. But there is a special case when a company performance is very good and promising, you must buy it at the moment you see it before it is too late. If you buy it later on, the price will explode and you can’t afford it anymore. And there is another case where a small company sell it low priced shares, but the buyer statistic was so high because they see the opportunities behind the company, or a great potential growing behind the company. The company’s share will be raising as the result. So, if the company real market selling is low, they can still gain profit from selling shares. If the company is lucky enough they can become large. But if the company is not lucky enough, they will end in debt.What is the benefit of the company from selling shares?
The company which sells share to trader are most likely wanting to raise fund from selling the share to the share trader. Or the money they gain from share will be used for getting more staff, making more workspace, advertising the company, or even invest more so they could make more money from it. This kind of system Is beneficial to each side because of the larger the company makes, the larger your money will return. Facebook is one of a successful share seller, they successfully sell their shares for net worth of $16 billion. A company is better selling a share for more growth, but it also is a risk.What to prepare in order to start investing?
First, you need to throw away your desires over money, because money is just a worker when you invest. Investing in the stock is a big game of betting. There is no absolute guess over the share performance. But when the company which sells the share are growing you will win the game. When your investment result in a failure you must have a good mental to take it, that’s why we said you need to throw your ambition form money. Because investing is risky.
Second, you need an enough starting money. For example you could store $100 every week onto your trading platform so it will become $400 every month. That is a good starting money for your investing business.
Third, Don’t spend all the money on one base. This is the most important thing on investing. If you spend all of the money over 1 company, the risk is so high because its 10/10 chance of failure when the company drop. But if you spend the $400 on 4 companies, the chance becomes 2,5/10 chance of investing failure. Start off with a not-too-big company, you must have the skill to determine if the company is good or not.
And last is don’t expect the money back in a short time. Like we have said in the top, money is nothing than a worker. If you want the money back in a short time, then don’t invest. Because investing really needs patients.
When you have profit, don’t spend all of it on your real life. Instead use 50% of it to invest more, that way is more effective to gain money. Don’t forget, money is nothing than worker. That’s all for today’s topic, we really hope you can be a successful investor in the future.